MANJIT KAUR vs. PR COMMISSIONER OF INCOME TAX PATIALA AND ANOTHER

Facts

The petitioner, Manjit Kaur, filed a writ petition challenging a notice dated 28.08.2024 issued by the Jurisdictional Assessing Officer under Section 148 of the Income Tax Act, 1961, and subsequent consequential proceedings. The petitioner argued that these proceedings were initiated without conducting a faceless assessment as envisaged by Section 144B of the Act. The revenue, represented by the Income Tax Department, accepted notice. The High Court noted that similar issues had been decided by its Coordinate Bench in previous cases, Jasjit Singh vs. Union of India and Jatinder Singh Bhangu vs. Union of India, both decided on 19.07.2024.

Held

The High Court held that notices issued under Section 148 of the Income Tax Act, 1961, and consequential proceedings initiated without conducting a faceless assessment as envisaged by Section 144B of the Act, were contrary to the provisions of the Act and therefore without jurisdiction. The Court relied on its previous decisions in Jasjit Singh vs. Union of India and Jatinder Singh Bhangu vs. Union of India. The reasoning was that instructions by the Board (referring to Section 119 and 120) could not override statutory provisions or make them otiose. Legislative enactments with financial implications must be followed strictly. The Court emphasized that instructions can only supplement statutory provisions and aid in their implementation, not usurp legal provisions or cause hardship. Consequently, the notices dated 28.08.2024, 16.03.2023, 23.03.2024, 20.03.2024, and 30.03.2023 were set aside for want of jurisdiction. The revenue was granted liberty to follow the procedure laid down under the Act if so advised. The writ petition was allowed.

Key Issues

1. Whether notices issued under Section 148 of the Income Tax Act, 1961, and subsequent proceedings initiated without conducting a faceless assessment as per Section 144B of the Act, are valid and have jurisdiction. (Mixed question of law and fact, concerning Sections 148 and 144B of the Income Tax Act, 1961). Assessee's Contention: The petitioner argued that the proceedings were initiated contrary to the provisions of the Act, specifically by not adhering to the faceless assessment scheme mandated by Section 144B. The petitioner relied on the decisions of the Coordinate Bench in Jasjit Singh and Jatinder Singh Bhangu. Revenue's Contention: The revenue, through its counsel, accepted notice and did not present any arguments against the petitioner's claim. The judgment states that the counsel for the revenue was ad idem with the petitioner that the issue had already been concluded by this Court in previous judgments.